Financial Performance - The Company recorded a net loss of $89,624 for the three months ended March 31, 2025, consisting of operating costs of $355,862 and interest expense of $1,125, partially offset by investment income of $267,363[137]. - The Company recorded a net income of $357,077 for the three months ended March 31, 2024, primarily from investment income of $735,578[138]. - The Company has not generated any revenues to date and will only generate non-operating income after the completion of its Business Combination[136]. - Interest expenses under the promissory note to third parties were recorded at $1,125 for the three months ended March 31, 2025[147]. Cash and Working Capital - As of March 31, 2025, the Company had cash of $17,229 and a working capital deficit of $3,214,910[139]. - The Company borrowed $241,112 under Working Capital Loans as of March 31, 2025, which are included in convertible promissory notes[141]. - The Company borrowed a total of $841,112 from the Chief Financial Officer in the form of convertible promissory notes, which are repayable upon the consummation of the Business Combination[143]. - The CFO also paid $144,060 to third-party vendors for working capital purposes, which are unsecured and due on demand[144]. - From July 2024 to March 2025, the Company borrowed a total of $975,000 from Tianji and its subsidiaries, with an additional $100,000 received after March 31, 2025, bringing the total to $1,075,000 due to third parties[145]. Business Combination and Acquisition Plans - The Company entered into a merger agreement on January 26, 2025, with Tianji Tire Global (Cayman) Limited, involving a total merger consideration of $450,000,000[131][133]. - The Company has incurred significant costs in pursuit of its acquisition plans and cannot assure the success of completing a Business Combination[116]. - The Company has incurred significant costs related to financing and acquisition plans, raising concerns about its ability to continue as a going concern if the Initial Business Combination is not completed by August 12, 2025[148]. - The Company has the right to extend the Termination Date of its Business Combination up to ten additional times by depositing $75,000 per month, with a current outstanding requirement of $600,000 for extensions[120]. Compliance and Regulatory Matters - The Company received a delisting determination letter from Nasdaq on April 23, 2024, but subsequently paid the outstanding fee to regain compliance[121]. - There are no off-balance sheet arrangements or long-term liabilities as of March 31, 2025[149][150]. - The underwriter is entitled to a deferred fee of $2,587,499, which will be revised to $750,000 in cash and 200,000 shares upon the closing of the Business Combination[150]. Management and Operations - Management does not anticipate any material effects from recently issued accounting pronouncements on the financial statements[152]. - The Company has conducted no operations to date, resulting in no unaudited quarterly operating data being included in the report[153].
Embrace Change Acquisition (EMCG) - 2025 Q1 - Quarterly Report